Souter and upturn put developer AMA back in black

The Springside development in Edinburgh is entering its final phase
The Springside development in Edinburgh is entering its final phase
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AMA, the high-end Edinburgh property developer backed by Sir Brian Souter as part of a £45 million restructuring three months ago, has seen a dramatic improvement in its fortunes on the back of the improving economy and greater availability of mortgages.

Although the independence referendum led to a temporary dip in activity, the firm – run by the Iranian-born Afshar family and behind projects including the former Fountain Brewery site in the city – said that sales had bounced back strongly since then.

Total sales in 2014 rose to more than £14m, up more than 20 per cent on the previous 14-month period, and the firm returned to the black with a £1.7m operating profit compared with a loss of £1.55m.

Late last year Scotland on Sunday revealed that Souter had made a major investment in the company as part of a restructuring deal which saw its bank debts paid off. The Stagecoach co-founder backed the firm through his Souter Investments private investment vehicle, which has stakes in Scottish bus builder Alexander Dennis and Poland’s PolskiBus. The AMA deal was thought to be Souter’s biggest investment in property for many years.

AMA said the restructuring, which came after it looked to find “alternative funding partners” to support the group alongside the clearing banks, has already enabled it to launch two new sites at Springside and Cramond and will allow the introduction of further new projects.

“The restructure and new funding has strengthened our balance sheet and allowed us to explore new opportunities and improve growth and profitability.”

Visitor numbers to developments improved significantly towards the end of 2014 and the company said those numbers had already converted into “buoyant sales, giving the group a great start to the new year”.

“The early signs for 2015 are extremely encouraging and a continuation of this would see even better growth,” the directors said.

The average sale price per property for the firm now stands at just under £450,000.

This year the company will continue work on the final phase of its Springside development, further phases at Cramond and it will also complete a development at Slateford Road.

The company has primarily been involved in the residential market but is moving into sectors such as student accommodation and serviced ­apartments but remains ­geographically focused on the capital. “We truly are an Edinburgh developer with each of our ­developments within the city boundary,” the company said.

Calum Cusiter, investment director at Souter Investments, joined the board of AMA following the investment deal.

Souter Investments has stakes in unquoted companies with a combined turnover of £1.8 billion and employing 10,000 people worldwide.